Tag Archives: RESPA

CFPB deepens probe into Zillow for RESPA compliance


This is taken from the latest Zillow earnings report:

In April 2017, we received a Civil Investigative Demand from the Consumer Financial Protection Bureau (“CFPB”) requesting information related to our March 2017 response to the CFPB’s February 2017 Notice and Opportunity to Respond and Advise (“NORA”) letter. The NORA letter notified us that the CFPB’s Office of Enforcement is considering whether to recommend that the CFPB take legal action against us, alleging that we violated Section 8 of the Real Estate Settlement Procedures Act (“RESPA”) and Section 1036 of the Consumer Financial Protection Act.

They later add they believe they fully comply with RESPA:

We believe our response to the NORA letter addresses the CFPB’s concerns related to our co-marketing program under which a lender pays us to appear in advertising alongside a real estate agent. We are continuing to cooperate with the CFPB in connection with their most recent request for information. We continue to believe that our acts and practices are lawful and that our co-marketing program allows lenders and agents to comply with RESPA.

CFPB again finds loan servicers routinely violate federal laws causing injury to homeowners

In the final days of June, 2016 the Consumer Finance Protection Bureau (CFPB) released its eleventh Supervisory Highlights report. The Report offers a summary of findings from CFPB regulatory investigations on loan servicing practices and compliance with federal statutes including the Real Estate Settlement Procedures Act (RESPA). The report is a devastating critique of the loan servicing industry, providing the general public a look into the continued systematic abuses of law and institutional incompetence of the companies that oversee collection of mortgage payments nationwide.

For homeowners who have been victims of loan servicing errors, the report offers a small bit of relief knowing that “you are not alone.” For attorneys representing homeowner victims, the report is a new arrow in the quiver because it details industry wide patterns of practices in violation of federal law. RESPA specifically awards statutory damages where a pattern and practice of wrongful behavior is exhibited and now consumers have government backed research to show industry wide patterns of abuse.

Read on.

RESPA Claims Cited by Foreclosure Defendants Fall Flat in Florida

Homeowners using the Real Estate Settlement and Procedures Act (RESPA) as a shield to foreclosure saw their claims fall flat in Florida court in recent months.

At least two cases decided by the United States District Court Southern District of Florida ended with the court siding against the homeowners and for the servicers, giving financial firms a bit more room when interpreting a significant part of RESPA.

Essentially, two cases – Russel v. Nationstar and O’Brien v. Seterus – tested the limits of a provision in RESPA, which requires servicers to respond to all written requests from borrowers who ask for information on their loans, including servicing information and payment schedules.

In Russel v. Nationstar, a borrower facing foreclosure claimed that Nationstar failed to provide a complete profile of the homeowner’s loan payment history. This report largely stemmed from the fact that the loan was previously transferred from another servicer. To retrieve the payment history, the borrower filed a series of qualified written requests to the servicer asking multiple times for their complete payment history, which dated back to a previous financial institution.

Because Nationstar did not provide an entire listing of each payment made to the prior servicer, the borrowers claimed their request for information under RESPA had not been met. The court sided with Nationstar, noting that all of the borrower’s responses were met and that the loan had not been delinquent at any time before Nationstar took over the servicing component. Based on the provisions outlined in RESPA, the court sided with the servicer and agreed Nationstar complied with the law by responding to each interrogatory issued by the borrower.

Read on.

Borrower alleges that Ocwen conducted ‘fraudulent’ modification program, violated RESPA

Case Law
Monday, March 16, 2015

A New York borrower who attempted and failed to modify his mortgage loan payments with Ocwen alleged that in his attempt to modify his mortgage loan, he discovered that Ocwen had more sinister intentions and none of them involved helping him to pay his mortgage. Here’s what the court said.

Source: RESPA News (sub. req.)

Former CFPB executive highlights hot spots in TILA/RESPA

On August 1 the industry will be forced to comply with theConsumer Financial Protection Bureau’s Truth In Lending Act and the Real Estate Settlement Procedures Act.

In order to help lenders better sort through the new world of TILA/RESPA, HousingWire hosted a webinar sponsored by Optimal Blue featuring guest speakers Benjamin Olson, partner at BuckleySandler and former Consumer Financial Protection Bureau deputy assistant director, office of regulations.

Other participants included Jerra Ryan, vice president of compliance with Cherry Creek Mortgage Company and Diane Evans, president of American Land Title Association.

Read on.

CFPB goes after Wells Fargo, JPMorgan for mortgage kickback scheme


Wells Fargo:

The investigation identified more than 100 Wells Fargo loan officers in at least 18 branches, largely in Maryland and Virginia, who participated in this scheme. The bureau alleges that these loan officers referred thousands of loans to Genuine Title over the course of the scheme.

Under the proposed consent order filed today, Wells Fargo would be required to pay $11.1 million in redress and $24 million in civil penalties. The bureau also filed an administrative consent order against Wells Fargo prohibiting future violations.

Wells Fargo employed Todd Cohen as a loan officer from April 2009 through August 2010. The bureau alleges that, while at Wells Fargo, Cohen not only received marketing materials, he also took substantial cash payments in exchange for referrals.

Under the proposal, Cohen and Oliphant Cohen would be required to pay a civil penalty of $30,000, and Cohen would be banned from participation in the mortgage industry for two years.

“Wells Fargo holds its team members to the highest ethical standards and does not tolerate improper activities or failure to comply with rules, regulations or company policies. We have fully cooperated with the CFPB in this matter and have taken strong corrective action, including terminating team members who were involved and enhancing our procedures to provide greater oversight and monitoring of both the process and our team members,” said Vickee Adams, vice president of WFHM External Communications.


The Bureau alleges that at least six Chase loan officers in three different branches in Maryland, Virginia, and New York were involved. These officers referred settlement business to Genuine Title on almost 200 loans.

Under the proposed consent order filed today, Chase would pay approximately $300,000 in redress and $600,000 in civil penalties. Additionally, the CFPB also filed an administrative consent order against Chase prohibiting future violations.

“We are fully committed to ensuring that our mortgage bankers comply with all legal and regulatory requirements. These former employees clearly violated our policies, procedures and training,” said Jason Lobo, vice president and head of external communications with Chase Mortgage Banking.

Bad news for BofA: Win for homeowners suing Countrywide

(CN) – A California couple did not have to show that they could pay back a home-equity loan before legally challenging an allegedly predatory Countrywide mortgage, the 9th Circuit ruled Wednesday.
After the lender refused to let them rescind a more-than $700,000 home loan and home equity line of credit, David and Salma Merritt sued Countrywide Financial Corp under the Truth in Lending Act (TILA) in 2009
The Merritts claimed that their Countrywide agent had lied to them in 2006 about the details of their loan, promising a relatively low monthly payment but then jacking it up nearly threefold days before closing. They said that the agent also had failed to inform them that the final $4,400 monthly mortgage payment for their Sunnyvale home was based on “teaser rate,” and that their payments would rise even higher in the coming years.
Countrywide’s agent, the home’s seller and an appraiser also all faced allegations of having conspired to inflate the value of the home in violation of the Real Estate Settlement Practices Act (RESPA). The couple further argued that the agent had failed to provide proper loan documentation, and that the home’s owner had lied about being the “selling agent.”
After paying some $200,000 on the loan over several years, the Merritts lost one of their incomes in 2008 and, unable to afford their payments, asked Countrywide for a modification. Countrywide refused, so the Merritts sought to rescind but Countrywide offered them only a modification that they still could not afford.
Dismissing their pro se federal lawsuit, U.S. District Judge James Ware in San Jose, Calif., found that the TILA claim could not survive because the Merritts had failed to pay back their line of credit before filing suit. Ware also found that the couple had filed their RESPA claims several years too late.

Read on.